Last Tuesday’s signals were not triggered, as there was no bullish bounce that day when the price reached the support level identified at 1.2060 for the first time.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be entered between 8am and 5pm only London time today.
Short Trade Ideas
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2050 or 1.2097.
Put the stop loss 1 pip above the local swing high.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
Long Trade Ideas
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2005 or 1.1961.
Put the stop loss 1 pip below the local swing low.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
EUR/USD Analysis
I wrote last Tuesday that the technical picture here had certainly become more bearish. I thought that the price looked like it would now make another attempt to break below 1.2060.
I was also ready to take a short trade from a bearish reversal at 1.2097, which looked to be both a strong flipped level, and was also quite confluent with the round number at 1.2100.
I thought that Tuesday was more likely to be a down than up day.
These were all good calls – Tuesday was a down day, and the price did make a successful attempt to break below the support level identified at 1.2060.
The U.S. dollar has continued to strengthen, and finally, the support level at 1.2005 which I identified as being very important due to its confluence with the big psychological round number at 1.2000 is also being threatened. We are not seeing much of a bullish bounce here at 1.2000 so far. If we get two consecutive hourly closes once the London session begins below 1.2000, that will be a bearish sign that the price is likely to fall further, probably to 1.1950.
I will take a bearish bias here on that eventuality, but I will also be prepared to take a short trade if we get a bullish retracement to 1.2050 and a bearish reversal off that level later.
I will not take any long trades in this currency pair today.
The Bank of England’s monthly policy release today at noon London time may cause knock-on volatility in the price here.
There is nothing of high importance scheduled today regarding either the EUR or the USD.